For older adults with children, the twin demands of retirement savings and college payments can overlap. Some financial planners suggest your IRA or 401(k) account is a good place to save for both.
Money in retirement accounts grows more quickly because it's tax-deferred, and may allow you to fund both retirement and college, says financial planner Jeffrey Feldman, of Rochester Financial Services. But make sure you can really afford to take money from your nest egg before you actually do it.
The Internet has handy calculators to help crunch the numbers. Financenter or Investor Guide can point you in the right direction. More detailed projections are available by using software such as Quicken Financial Planner.
Parents who are 59 and 1/2 when they start withdrawing from their 401(k)s pay no penalty. Younger parents may want to save for college in an IRA. It can be used for college expenses, at any age, without penalty.
